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California Cracks Down On Autism Insurance Denials

(April 17, 2014) -- The California Department of Insurance has won the go-ahead to enforce tough new requirements to stop private insurers from denying and delaying coverage for behavioral health treatments, such as applied behavior analysis (ABA), for autism.

The department based the new regulations on its interpretation of the state's 1999 Mental Health Parity Act and won approval Wednesday from the Office of Administrative Law to begin enforcement. California is one of 35 states to require certain commercial insurers to cover behavioral health and other treatments for autism by law, yet still encounters widespread non-compliance by the industry.

"Approval of the mental health parity regulation will help end improper insurer delays and denials of medically necessary treatments for autistic individuals," said Insurance Commissioner Dave Jones. "This regulation provides clear guidance to the industry, stakeholders and consumers on the requirements of the Mental Health Parity Act from 1999."

The department proposed the new regulations when it found insurers were able to delay or deny medically necessary treatment for individuals with autism as required under California's 2011 auitism insurance reform law. The regulations further define the circumstances in which insurers must cover behavioral health treatment by specifically applying the requirements under the Mental Health Parity Act.

Since 2009, the Insurance Department has referred 23 cases related to denials of behavioral health and other autism treatment to external clinicians for Independent medical review. Of those, 19 were overturned.

In another 40 cases that have been closed, the individual delays in obtaining treatment averaged nearly half a year; delays currently average over 10 months, or almost a year, for those cases which are still open. The cumulative delays on open and closed cases total 12,864 days, or 35.2 years.

"These lengthy delays all involve treatment that experts agree is most effective when provided in early childhood," the department argued in its regulatory proposal. "The benefits anticipated from the proposed regulation include significantly lessening or eliminating these delays and denials of treatment and substantially improving treatment efficacy and outcomes."